Financial markets are enduring a high-tension session marked by a forceful global selloff in sovereign debt and a rebound in oil prices\u2014factors that are hammering European equities and pushing Spain’s Ibex 35 further away from the symbolic 20,000-point threshold. Investors are grappling with a cocktail of fears combining escalating geopolitical tensions in the Middle East with persistent concerns over fiscal mismanagement and inflationary pressures.<\/p>\n
The immediate trigger for this new wave of risk aversion lies in the deteriorating situation in the Strait of Hormuz. Following missile alerts issued by the United Arab Emirates, Abu Dhabi announced that two projectiles launched from Iran had struck maritime traffic, prompting the suspension of commercial and financial transactions with Tehran. UK maritime authorities also reported a vessel being hit while exiting the strait, while another cargo ship was struck off the coast of Yemen.<\/p>\n
“These incidents demonstrate a growing disruption to major shipping routes, and traffic through Hormuz remains constrained despite Trump’s claims that the strait is open,” commented analysts at Danske Bank. The verbal escalation by U.S. President Donald Trump has added fuel to the fire. The president has lashed out at Oman, a country negotiating with Tehran over the reopening of the maritime passage, going so far as to threaten to bomb it “into oblivion” if it stands in the way of his plans. Trump also reiterated his provocative idea of declaring the Strait of Hormuz “American territory.”<\/p>\n
Ipek Ozkardeskaya, senior analyst at Swissquote, noted that “the main market driver since Monday has been the escalating tensions in the Middle East, which are pushing oil prices and yields higher\u2014amid expectations of rising inflationary pressures\u2014and these are weighing on equity valuations.” The expert anticipates that “the downward correction in equities is likely to intensify,” though she notes that energy companies remain a good hedge against the worsening crisis.<\/p>\n
Sovereign Debt at Decade-Highs<\/p>\n
Selling pressure on bonds is the epicenter of investor unease. The yield on the 30-year U.S. Treasury bond touched 5.327%, its highest level since June 2007, while the 10-year climbed to 4.74%, approaching the highs recorded during the current Trump administration. The rout is not limited to the United States: Japan’s 30-year bond surpassed 4% for the first time in history, the German Bund climbed to 3.26% (its highest since 2008), and French and Italian debt moved decisively above 4%.<\/p>\n
Italy’s 10-year BTP maturing in July 2036 advanced to 4.07%, six basis points higher than Monday’s close and within striking distance of the March peaks, when it reached 4.1%. The spread between the BTP and the Bund widened slightly to 82 basis points, up from 79 in the previous session.<\/p>\n
AssetCurrent YieldRecent Historical HighU.S. Treasury 30-year5.327%Highest since June 2007U.S. Treasury 10-year4.74%Near Trump-era highsJapan 30-year bond>4%First time in historyGerman Bund3.26%Highest since 2008French 10-year OAT4.11%Highest since 2011Italian 10-year BTP4.07%Near March peak (4.1%)<\/p>\n
Note: Yields recorded during the session on Tuesday, August 18, 2026.<\/p>\n
Analysts at Renta 4 explain that this rise in yields “is primarily driven by concerns over the widespread increase in debt levels and projected deficits, inflationary pressures\u2014further strained by uncertainty over the Iran war\u2014and the elevated level of corporate debt issued in recent months by large AI companies that are attracting significant interest.”<\/p>\n
Inflation Complicates the Outlook for Central Banks<\/p>\n
The rebound in energy prices is fueling expectations that inflation will remain elevated for longer than anticipated. Final eurozone inflation for July came in at 2.9%, driven by rising energy costs. European Central Bank (ECB) Chief Economist Philip Lane anticipated that inflation will remain near 3% for the rest of 2026, although the trajectory of prices will depend heavily on whether the Middle East crisis is ultimately resolved.<\/p>\n
Lane emphasized that euro-area inflation will be “well above” the 2% target this year, a scenario that makes it difficult to imagine the ECB not acting to tighten interest rates, just as the market is already pricing in on the other side of the Atlantic. In the United States, the minutes from the Federal Reserve’s July meeting are due to be released tonight, a document investors will scrutinize given the marked internal divisions within the central bank. At that meeting, there were three dissenting votes in favor of raising rates\u2014a fracture about which markets are seeking more details.<\/p>\n
Jonas Goltermann, chief economist at Capital Economics, notes that bond market moves reflect “a world characterized by greater fiscal, geopolitical, and economic policy uncertainty, requiring higher compensation for holding long-duration debt securities.” The analyst also cites investor “unease” over the ambiguity of the new Fed Chair Kevin Warsh regarding the monetary policy framework. “The stakes are high heading into his keynote speech at Jackson Hole next week,” Goltermann warns.<\/p>\n
Other Markets and Partial Tariff Truce<\/p>\n
In commodities markets, Brent crude reached $91.83 per barrel, while West Texas Intermediate (WTI) stood at $85.78. Gold, meanwhile, fell 0.63% to $4,392 per ounce. In currency markets, EUR\/USD traded around 1.1594 dollars, while bitcoin dropped to $64,217.<\/p>\n
On the trade front, the U.S. president announced a three-day pause on planned 50% tariffs on approximately $20 billion worth of Canadian goods that were set to take effect at midnight. Trump claimed that both parties had reached an agreement, subject to final documentation, and raised the possibility of reviving the Keystone XL pipeline. However, Canada has not confirmed the full terms, and Prime Minister Mark Carney stated that much work remains to be done.<\/p>\n
Juan J. Fdez-Figares, Director of Collective Investment Management at Link Securities, warns that “growth stocks are very likely to remain under selling pressure, at least in the short term and until a solution to the aforementioned conflict comes into view and both crude prices and bond yields ease.” The expert agrees with the widespread view that European indices\u2014cyclical and energy-dependent\u2014are in theory more sensitive to energy prices than their U.S. counterparts, which are heavily influenced by the technology sector.<\/p>\n","protected":false},"excerpt":{"rendered":"Financial markets are enduring a high-tension session marked by a forceful global selloff in sovereign debt and a…\n","protected":false},"author":2,"featured_media":73036,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[5945,28257,28258,194,8293,20020,19341,28259,2606,28256,17,306,1564],"class_list":["post-73035","post","type-post","status-publish","format-standard","has-post-thumbnail","category-spain","tag-brent","tag-btp","tag-bund","tag-donald-trump","tag-european-central-bank","tag-federal-reserve","tag-ibex-35","tag-kevin-warsh","tag-mark-carney","tag-philip-lane","tag-spain","tag-strait-of-hormuz","tag-u-s-treasury"],"_links":{"self":[{"href":"https:\/\/www.europesays.com\/spain\/wp-json\/wp\/v2\/posts\/73035","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/spain\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/spain\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/spain\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/spain\/wp-json\/wp\/v2\/comments?post=73035"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/spain\/wp-json\/wp\/v2\/posts\/73035\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/spain\/wp-json\/wp\/v2\/media\/73036"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/spain\/wp-json\/wp\/v2\/media?parent=73035"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/spain\/wp-json\/wp\/v2\/categories?post=73035"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/spain\/wp-json\/wp\/v2\/tags?post=73035"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}